Illinois Tool Works’ foodservice equipment division saw a slight sales decrease in the year’s second quarter, with revenue falling from $553m to $548m compared to the same period in 2018.
The company, which owns Hobart, Traulsen and a string of other brands, posted operating income of $140m for the period, achieving an operating margin of 25.6%.
The fall in revenue compared to last year was symptomatic of a general slump, with the group’s overall revenue of $3.6bn down from $3.8m.
In light of the news, Scott Santi, the company’s chairman and CEO, remained defiant, claiming that against the backdrop of a more challenging demand environment the results represented a “solid” return for the group.
He said: “Operating margin improved year-over-year to 24.4 percent, excluding higher restructuring impact of 30 basis points, as enterprise initiatives contributed 110 basis points.
“The combination of unfavorable foreign currency translation, higher restructuring expenses and a small loss on two divestitures reduced EPS by $0.09 year-over-year.
“Excluding these three items, EPS would have increased two percent to $2.00. Free cash flow increased 14 percent year-on-year.”
He said that the firm was updating its full year guidance to reflect current levels of demand and that it continued to expect a stronger second half of the year on a relative.
He concluded: “We expect continued strong contributions from enterprise initiatives, positive price/cost margin dynamics, and strong free cash flow as we progress through the balance of the year.
“While we will be prudent in making appropriate adjustments due to the near-term demand environment, we remain focused on managing and investing to maximize ITW’s performance over the long term.
“The highly differentiated nature of ITW’s core competitive advantages and the strength and resilience of our proprietary business model and diversified portfolio position us well for strong financial performance across a wide range of economic scenarios.”